What is I-O?

Industrial-organizational (I-O) psychology is the scientific
study of the workplace. Rigor and methods of psychology are
applied to issues of critical relevance to business,
including talent management, coaching, assessment,
selection, training, organizational development,
performance, and work-life balance.

Organizations could be better led if more attention was paid to selecting and developing leaders

Business failures—and there are many—more often than not are the result of poor leadership, say three veteran leadership authorities who during their careers have seen many organizations struggle because of ineffective leaders.

“It seems every sector of our society—business, education, medicine, military, and government, to name a few—has had its share of incompetent leadership, which erodes peoples’ confidence in organizations,” said Gordon Curphy, president of Curphy Consulting Corporation in St. Paul, MN.

Curphy, along with Robert Kaiser, president of Kaiser Leadership Solutions in Greensboro, NC, and Robert Hogan, president of Hogan Assessment Systems based in Tulsa, OK, have strong and pointed opinions about why leadership is failing.

They cited a variety of surveys and polls, which show the sad state of leadership in this country, including a National Leadership Index 2012 study conducted by the Harvard Kennedy School’s Center for Public Leadership which found that 69% of Americans believe there is a leadership crisis in the United States.

A recently released Gallup survey of the American workplace revealed that only 30% of employees “were engaged or involved in, enthusiastic about, and committed to their workplace.” Poor leadership cripples businesses and lessens engagement levels of workers.

And the future of leadership is not encouraging. A recent survey by Development Dimensions International (DDI) of more than 14,000 line, and HR executives reported that only 32% of line and 18% of HR leaders felt their organizations had sufficient up-and-coming people in their leadership pipeline to meet future business needs. A study by The Conference Board found that fewer than half the organizations surveyed lacked the leadership talent needed to execute strategies.

Gallup has been looking at organizational leadership the past 20 years and the data show that 20% of respondents say they like their management. The other 80 % either don’t like or are ambivalent about their managers. The real news here, says Hogan, is that most of the disaffected were high potentials: individuals considered to have leadership abilities and being groomed for leadership positions.

Yet the training and development industry is thriving. It is estimated that $14 billion is spent annually on leadership development, which presents a puzzling picture because although spending is up, confidence in leaders is down. Something doesn’t seem right.

Why the disconnect? “Too often we are captivated by the cult of personality and lose sight of the function of leadership,” said Kaiser. “There is a focus on leaders at the expense of the group and its performance. Followers are the key to leadership.”

“If the wrong people are in charge, it can be disastrous for the employees and the organization. The research shows that not all bosses can lead. Some people have the talent for leadership and some don’t. So it really matters who is in charge,” said Hogan.

“Unfortunately people rarely get appointed to senior positions based upon their talent for leadership; rather, they reach their job level as a result of internal politics,” he added.

Hogan is blunt about his assessment of today’s leaders. “Two-thirds of CEOs on the job today will be gone in 3 years. Simply put, there is a lot of incompetence in leadership positions.”

Kaiser believes the focus of leadership training programs must be changed. “Much of today’s leadership development is better framed as ‘career management’; helping managers get better approval ratings and promotions. Rather the emphasis should be on helping leaders get better results by engaging employees and building high performing teams because the person in charge cannot do alone everything that needs to done.”

What should be the focus of the leadership training and development? First there needs to be a clear consensus of what leadership is and to have sound operational models staffed with people who have the needed competencies and skills. “Unfortunately, managers try to be too inclusive and slot the wrong people into leadership positions and programs,” said Kaiser.

To Hogan, the definition of leadership is clear. “Leadership should be defined in terms of the ability to develop and maintain a team, and leadership should be evaluated based upon the team’s performance.”

Curphy added that organizations need to determine the pivotal leadership positions and focus on the people in those positions as well as the high potentials being groomed as future leaders. “Identifying the right people can be accomplished through available and valid assessments. Then allocate training dollars on those who will make a difference and best develop and carry out organizational strategies,” he added.

Hogan and Curphy are the authors of Rocket Model: Practical Advice for Building High Performing Team, which provides a clear path to developing efficient work teams.

It all starts with the context in which the team will operate within the organization, including the environments, resources, and regulations. That is followed by determining the purpose of the team and what is needed to accomplish the purpose, including setting clear and measurable goals,

Attracting competent talent is the next crucial step, including getting the right number of people, setting the right structure (having too many people can be just as bad as not having enough), getting people with the needed skills, placing people in roles that are clearly defined, and getting the right followership, that is people who will be engaged, and avoiding “team killers”--those who will be disruptive to the team and who will not be a good fit.

Hogan adds, “Good management is all about creating engagement. And it’s very simple. How a manager treats his or her staff drives their level of engagement. When engagement is high, you get good business results. You get low turnover, low absenteeism, high productivity, and high customer satisfaction ratings. Those all mean dollars. When engagement is low, you get high turnover, high absenteeism, low productivity, and low customer satisfaction. So good managers make more money for the organization, bad managers drive unnecessary costs.”

Fortunately many of the answers to finding the right leadership are available.

“People get chosen for leadership positions for the wrong reason,” said Hogan. “They have engaging personalities and look good in interviews. A lot of bad leaders are good interviewees. Bad leaders can be avoided by using proven scientific methods and assessments to evaluate potential leaders.

One of those methods is to employ personality tests using valid assessments carefully constructed by psychologists and social scientists, which, according to Hogan, are the best single predictor of leader performance. He cited research by Gallup showing that manager personality impacts staff engagement. “Staff engagement predicts business performance, and good managers create engagement. Bad management destroys engagement,” he said.

Unfortunately, said Hogan, those doing the hiring seldom consider the science of making sound hiring decisions. “Industrial and organizational psychologists can find good people, but we need to get boards and those doing the hiring to listen. We can predict a lot about potential leaders’ abilities and whether they can be successful, but few are listening or asking,” said Hogan.

He said the qualities hiring managers should look for in potential leaders include:

Integrity. Is the person honest, can you trust the person, is he going to sell us out, is he going to exploit his position and the company’s resources for his own purpose, and does he keep his word?

Judgment. The base rate of good business decisions is about 50%. And so, good judgment is all about being willing to repair bad judgment. Although good judgment is always the goal, things often do not work our as planned. So good judgment is also being willing to evaluate your decisions and then see if you have gotten them right.

Competence. Followers want to be assured and feel confident their leaders know the business.

Vision. Can the leader explain it, justify it, and can he or she impress upon the work team that what they are doing is worthwhile?

Hogan maintains the real leadership problem in organizations is at the first line supervisor level. “The C-suite people think they are responsible for the level of engagement within the organization, but they are not. Alienation is caused by first line supervisors and leads to disengagement among the workers, which is where strategies developed by top leaders are carried out. The best single data source is to ask the staff about internal candidates being considered for promotion, but very few do that.”

Scientists are often their own worst enemy, said Curphy. “There is a lot of information produced by academics and psychologists about leadership and team building, but it is in bits and pieces. They are looking at small dimensions of the big picture, and the information and research is not stitched together in such a way to benefit the people who are in leadership positions.”